Toyota Case Study

515 Words3 Pages
Question 1: Explain one reason why a car manufacturer, such as Nissan, would aim to reduce cash tied up in stock. Cash tied up in stock is where all a business’s money is invested in stock and leaves the business with little money for other things it may require. For example Nissans money would be invested heavily on car parts and so on. Nissan would not want to have all their cash tied up in stock for multiple reasons. One reason could be damage to the factory producing the goods for Nissan, if there is a fire or any damage to the factory, all of Nissans money would be lost as they are all tied up in stock. This would also mean Nissan would not have as much money left over to gain back what they lost. Question 2: Why might car manufacturers want to achieve a short product development lead-time? Short product development lead time is the time between developing a product and having it ready to sell. A car manufacturer might want to have this short because they would want to get it out in the market to get sales higher and to make profit. The shorter the development lead-time the better for the manufacturer as they have product out longer and they have to spend less money as time is money. Question 3: With reference to Toyota, explain two purposes of consumer protection legislation. Consumer protection laws are laws aimed at protecting consumers, for instance by assuring that consumers have more complete information about items they are considering buying. One of them is the Trade Descriptions Act 1968, which requires a trader to describe goods accurately. This is very useful for consumers as they have the right to complain when something is sold to them and not accurately described. It would therefore be illegal to sell a product that is falsely described. Also another one is the Consumer Protection Act 1987 is a law which makes harsh liability for
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